Gateways

Most big technology changes don’t come out of nowhere. There are predecessor technologies that predate and portend what is to come. I like to call these predecessor technologies “gateways.”

In the case of the web, there were two important gateways. The first was CD ROMs. There was a moment in NYC in the early 90s when we all thought CD ROMs were going to be the future of media. That is when the NY New Media Association was formed and there was a ton of excitement in the air about new digital.media services that would be delivered to our computers via CD ROMs.

Around the same time we saw the rise of online services like AOL, CompuServe, and Prodigy. These services allowed users to connect via dialup modem and do things like chat and email.

The CD ROM wave taught users to browse and explore rich media on their computers.

The online services wave taught users to dialup and chat and email.

So by the time the web browser showed up in the mid 90s, users were primed for the combination of the two – dialing up to chat, email, and browse rich media. It was a killer combination of the two and so much more.

As we think about crypto, we look for these gateways. One is certainly the financial speculation and trading of crypto assets. That has brought millions to the crypto sector and is the primary reason that people own or have owned crypto assets.

Another might be stablecoins that operate on closed or semi-closed networks. These stablecoins may not support the broadest set of applications envisioned by projects like Ethereum and others, but they may get hundreds of millions of people around the world owning and transacting with crypto assets.

It is tempting to get caught up in the big vision of what is possible with a powerful technology.like crypto and dismiss the gateways. But that would be a mistake as they are often necessary to set the stage for what is to come.

Comments (Archived):

William Mougayar
Dec 16, 2019

Yup and a lot of tinkering is required as those gateways aren’t perfect by any means.

awaldstein
Dec 16, 2019

This is great.Esp the CD-ROM piece.When we started CREAF in the very early 90s, we had no rights to sell Sound Blasters so we created the MM upgrade kit as a sound card bundle, became the worlds largest distributor of CD-ROM drives because we distributed Microsoft’s MM extensions.Tens of millions of CD-ROMs which led to the creation of the light game to fill the extra space on the CD.We used that success to go public and buy the distribution contract for the cards back from the then distributor.Thanks for this opportunity to mull on this for a moment.What a crazy ride so early in my career.

Tom Hughes
Dec 16, 2019

I certainly didn’t see that DVDs were the gateway to streaming movies and TV. Netflix did, and by distributing DVDs by mail, they started an OK-seeming business that gave them a big head start on streaming, since they already knew the prospects most interested in on-demand at-home video.

kidmercury
Dec 16, 2019

dlive is definitely pulling people on and showing what’s possible. it really fits the disruptive theory viewpoint as well, with the product satisfying a totally neglected, undesired niche market (thus competing with non-consumption) with the potential to grow into a larger adjacent market (currently livestreaming for kooks, tomorrow livestreaming for everyone). alexa rank of ~7000 for dlive — is there another crypto app, excluding exchanges, with a better rank? #revengeofthekooks #kookpride

Girish Mehta
Dec 16, 2019

Remember this picture from 1994. “”This CD-ROM can hold more information than all the paper that’s here below me.” – Gates https://uploads.disquscdn.c…In November 1995, I saw DVD for the first time at Comdex at the Toshiba booth. DVD was introduced at that show. Until then it had been called “digital video disc”, and it was changed to “digital versatile disc” by the industry to represent the broader software applications besides movies.I remember coming back from 1995 Comdex and doing a pop quiz – ok, so what does DVD stand for ? :)The “Sony+Philips” audio CD was first commercially available in 1982 (although the origins of CD go back to the late 1960s). The CD-ROM was subsequently commercially launched by 1984 (Sony and Denon).It took over 10 years from 1982 (audio CD launch) to ~ 1992-1993 before the usage of CD-ROM started to go mainstream. The Gates picture is from 1994.I wonder if there is crypto gateway equivalent to the Gates picture.

Vendita Auto
Dec 16, 2019

DCEP Huilu {exchange rates} is the most interesting gateway.Belt & Road initiative with Africa the prize

Michael Brill
Dec 16, 2019

Yes! Speculation is the killer app (for now). Tokenization, fractionalization and exchange of assets is something crypto can do *right now* extremely well and that’s where *all* of the money is being made. Would love to see more venture $ going to that vs. solving problems that only matter after civilization breaks down.

Andrew Cashion
Dec 17, 2019

Stable coins or stablecoin?

Michael Brill
Dec 17, 2019

Probably not a question for me, but definitely stablecoinS. I can’t think of anything more likely than central bank digital currencies (CDBCs), starting with China next year and then frantic mayhem for the west to try to catch up. sigh.

Tom Labus
Dec 16, 2019

You had to pay for quarterly and annual reports of public companies. The flow and quantity of financial data is now continuous and free.

JLM
Dec 16, 2019

.I still have some old Standard & Poors booklets. I bought them.JLMwww.themusingsofthebigredca…

Mike
Dec 16, 2019

Absolutely. I might be looking for more stablecoin applications and business models to develop that don’t rely on appreciation of the crypto asset or token. Same for enterprise blockchain applications, perhaps integrated with new enterprise SaaS offerings.

JLM
Dec 16, 2019

.I think the CD-ROM was the precursor, the ancestor — not a gateway — to the flash drive.CDs started out as audio storage, then came data, then came a standardized way of manufacturing them which was codified in the Yellow Book. That started in 1982, hitting the mass market in 1984.The flash drive showed up in 2000 with incredible adaptation and acceptance thereafter until today when we can get a lightning fast 2TB flash drive. The USB interface made the flash drive easy.Today, that original function was broadened from “read-only” to read-write and the magnitude and speed of transfer was improved — voila, the flash drive.CD-ROMs and flash drives have stayed in their lane — storage.They were a natural progression rather than a gateway. Flash drives did what CD-ROMS did just faster and more of it. The basic parameters didn’t really change.The fixation, the novelty, the innovation was always the content. From being able to transport music to software and data, now a flash drive can transport or store anything that can be held in digital format. You can even put a computer on a flashdrive.There is a lot of “bashing-to-fit” with crypto. We are still searching like Diogenes, walking the earth with a candle looking for a honest/true application.JLMwww.themusingsofthebigredca…

Susan Rubinsky
Dec 16, 2019

“The Medium is the Message.” — Marshall MclhuanThe CD-ROM and the Flash Driver were the mediums. The Rich Content on them was the new media. It’s the Medium + the Media that create the gateway.https://www.youtube.com/wat…

Girish Mehta
Dec 17, 2019

Re: “There is a lot of “bashing-to-fit” with crypto”.This is the age of the narrative. Especially in the crypto sector, and more broadly in tech. It is increasingly about the framing. From VCs to founders you hear the same story – That you need to be a good storyteller. Kind of funny to watch.Diognenes would understand. When he was reminded that the people of Sinope had sentenced him to exile, he replied “And I sentenced them to stay at home”.Talk about framing.p.s. The ancestor of the USB flash drive was the 1.44 MB Floppy disk. Both writable and used to save files, which the CD-ROM was not…USB flash and CD-ROM is a bit of apples-oranges. I drove that pricing-merchandizing of the removal of the default FDD from a PC in a region in the early 2003-ish timeframe and driving the adoption of USB key. Removing the defaulted Floppy disk from the computer, a optional Floppy disk drive was offered along with optional USB key, and one could to see in real-time if customers preferred the optional FDD or the optional USB key. USB keys started at 8MB…but started to see traction from 16MB onward….that was 10X the capacity of a 1.44MB Floppy. Customers quickly moved data and usage behaviour from floppies to USB keys. Could write a longer comment, but will desist :).USB keys and optical drives co-existed for significant time (CD-ROM/DVD-ROM/CD-R/CD-RW/DVD-RW) along with the optical drive 1X/2X/…32X speed transitions (also the write speed and read speed on the same drive would be different). USB key capacities went 16MB-32MB-64MB-128 MB-256MB every 4-6 months and then overtook the optical drive capacities. Today, of course, this is not even a question.

Matt A. Myers
Dec 18, 2019

The idea of crypto-“currencies” – the narrative of it being “trustless” as a positive that has mostly died out, is backwards and has unavoidable pitfalls.It’s not only backwards but it’s lazy. Comparatively trust takes effort, time through relationship building, and tied to trust is the important mechanism of accountability – which crypto-“currencies” initially heavily boasted as a positive; have any of them thought through natural trust mechanisms, thought through why they exist?Is the goal of “trustless” decentralization to own the system but externalize the real costs and fallout of these systems to centralized authority – who now have a smaller toolkit to counter bad actors, e.g. like economic sanctions? It sure seems everyone is fixated at the level of making $ via the Ponzi-Pyramid scheme mechanism of “adoption” (buying into) the system, rather than practical and usefulness at a competitive cost that differentiates from other technology options – which their pitches never seem to include: how do we outcompete with existing status quo competition? They seem to justify ignoring it claiming “blockchain” is a new technology so it doesn’t have a comparable – more drivel as part of their complicated narrative.I don’t think there’s been much, or honest, critical thinking through to what the end game looks like to these systems – they just see the $$$ signs and are blinded by it.What Twitter is trying to do is The Independent Web idea – except where they couldn’t monetize if they didn’t “own” the underlying infrastructure they closed up to control, however when they have the ability to “own” the blockchain structured as a Ponzi-Pyramid scheme – then there’s at least the chance they can own part of the system, and rallying people in the Ponzi-Pyramid scheme to join them – except the counter-narrative that will develop will be their downfall – along with their higher unnecessary costs, seen as greedy and perhaps stupid to buy into an unnecessary Ponzi-Pyramid scheme.And for those who don’t know me, I think there is potential for a global decentralized block-chain based currency, however it will be run by democratically elected governments – who trust each other, who have real world trust networks and alignment on policies and culture – who will implement and run the system, distributing the mining capacity amongst nations; this way there’s at least a strong chance of managing for bad actors if they find themselves into the systems – and they don’t have to be, won’t be, structured as Ponzi-Pyramid schemes unnecessarily redistributing wealth simply because someone was an early adopter.Saner minds will prevail.

Gateways and their gatekeepers. Libra feels like it could be exactly that. Keep the $10 million and use it help to build a different gate.

Abhi Syal
Dec 17, 2019

Well.. This means thatCrypto + = .. I guess this is what we all are trying to figure out.. FB tried that:Crypto + Marketplace = Untapped financial markets ?

pointsnfigures
Dec 17, 2019

You have a gigantic regulatory blocker today that you didn’t have before. Plus the entities that control the assets have to be educated. Until the SEC moves many will say it’s not safe. Interestingly the CFTC is moving much much faster. Hopefully the new Senator from Georgia will educate the legislatures which has oversight on the SEC

sigmaalgebra
Dec 17, 2019

ForMost big technology changes don’t come out of nowhere. There are predecessor technologies that predate and portend what is to come. I like to call these predecessor technologies “gateways.” I clap for that!Sit down for this: IMHO you have with this example put a crack in the biggest problem facing the growth of computing, automation, standard of living, the economy, and civilization. Yup.How? At least in the STEM (science, technology, engineering, math) fields, a word used with a meaning not in a standard dictionary is a term, to be more clear in the STEM fields, a technical term.Then, if only from common sense, no heavy lifting required, each such term, at its first use in a context, should be motivated and defined and provided with some examples (links as in a URL can also be sufficient). THEN the readers can understand the term and hopefully then the rest of the information in the communication. Moreover we don’t like synonyms for such terms — synonyms would create confusion.For the potential of computing, automation, …, civilization, currently progress in computing is far too slow, and the main reason is the poor quality of the technical writing to communicate the crucial information. Bluntly, the people doing the work are unable to provide the information to describe their work. The first and worst problem in this poor quality information is failure to define terms.So, Fred, for your paragraph I quoted here, presto, bingo, magnifico, alleluiahttps://www.youtube.com/wat…you introduced a term, gateway, defined it and motivated it. In later paragraphs you gave examples. And, thus, if only by example, although not the first but one more is very welcome, you put a crack in the biggest problem facing the growth of computing, …, civilization.The alternative? In the software on a server for a Web page, want to make some use of relational database. So, …, need a connection string (right, a term, i.e., can’t find the meaning in an ordinary dictionary). So, read the available documentation — gads, as clear as maybe the dead sea scrolls, some ancient Chinese writing, the ashes of a burned book, etc.So, just have to try, that is, guess and see if it works. So, this work is like throwing mud against a wall — overhand, underhand, backhand, with topspin, etc. — until it appears to stick. Then, …, (did I mention a problem facing growth?) a full WEEK, seven days, with long hours each day, finally, for still no known reason, it stuck!After a few hundred of these in just one project, i.e., mine, we’re talking an example of the SUV of progress struggling up a steep hill on a dirt road covered in ice.This situation goes WAY back in computing.A basic cause is that there is something about computing and the STEM fields more generally that the people doing the work don’t know how to describe their work.A deeper cause is how writing is taught: It’s taught by, and may I have the envelope, please, English majors who love Belle Lettre, and apparently profoundly HATE the STEM fields.For the gateway technologies, I’d list:(1) the Bell Labs work, well along by about 1970, on tiny Ga-Al-As heterojunction solid state lasers lighting long haul optical fibers,(2) the history in computing of text markup languages, e.g., early Runoff (IIRC, Bell Labs, actually one of the main applications they had in mind for the C programming language) to D. Knuth’s TeX, etc.,(3) X, Y, Z-modem communications software,(4) TCP/IP, IIRC, from the Berkeley computer services group’s work funded by the US Department of Energy, resulting in BSD (Berkeley Software Distribution) for Unix, Linux, TCP/IP, etc.(5) TCP/IP in Microsoft’s Windows,(6) ARPA’s funding of the early Internet,(7) SMTP (IIRC, simple mail transport protocol) especially with the extension MIME (multi-media internet mail extensions, especially Base 64 encoding) to permit sending pictures, sounds, video,(8) HTTP (IIRC, hyper-text transmission protocol) essentially borrowed from the TCP/IP e-mail standard SMTP (IIRC, simple mail transport protocol),(9) T. Lee’s HTML (IIRC, hyper-text mark-up language),(10) The Mosaic Web browser from the NCSA (National Center for Supercomputer Applications)https://www.livinginternet….(11) IP routers with enough capacity, with interfaces to the optical fibers,(12) IIRC, Juniper’s BGP (border gateway protocol) to help make the core, backbone of the Internet faster,(13) End to end electronics to use existing coaxial cable to the last mile to carry IP traffic at data rates up to 1 Gps.More generally the goal was to let people at personal computers communicate for all purposes. For that, needed communications technology, hardware, and software. Now we have that.Now on to more!

JamesHRH
Dec 17, 2019

You have this backward.Largest NA web developer in 1999 was based in Calgary because they had gotten into MB to pitch a CD & hit it off with decision maker who told them ‘ we are going to do that on a web site.’‘ We can do that for your’ lied the Founder – good lesson there for service firm founders: customers are everything.That’s new skills from a small wave of an innovation tsunami moving forwards onto a bigger wave ( even if it is not the Big One ).Crypto trading is the massive, long established financial speculation wave absorbing a smaller wave : fad : niche. How do I know that it is not a sign of a tsunami?Whacking the next set of goons in crypto takes the exact same skill set as whacking the next set of goons in stocks, RE, commodities……..Feel for you Hoss.

Alex Rinaldi
Dec 17, 2019

What does this mean??Whacking the next set of goons in crypto takes the exact same skill set as whacking the next set of goons in stocks, RE, commodities……..

JamesHRH
Dec 17, 2019

If you have seen a tulip craze before, or a shortage in a commodity, you can time the market, buying early and selling into the teeth of the stupid ( usually part time or first time buyers ).Goons make their first Bitcoin purchase – and invest all their stake – at $17,000.

Ian Fellows
Dec 17, 2019

I agree about gateways. Makes me think a bit about Uber and Lyft getting us used to on demand transportation so that when driverless cars truly make their debut, the transition will be just a tiny step.That said, I don’t share your vision for the future of crypto. The thing about gateways is that they should be useful in their own right. Crypto speculation (i.e. speculation on an asset with no intrinsic value) is at best useless and at worst a threat to overall market stability. The other major gateway for Crypto is the sale of drugs, illegal arms and other items too disturbing to think about. This application is certainly very useful to those engaged in the activity, but is not useful for society as a whole. I genuinely want to discover the major gateway use case where Crypto is the “right” solution. The only fruit I’ve had in that search is the game Gods Unchained, which makes a compelling case for using Crypto for in game assets.Finding your gateway (i.e. something Crypto can do that is actually useful) is going to be critically important over the next couple years. Otherwise you are going to get a lot of people saying: “Hey Crypto, you’ve had a decade to show me something useful and the only real economic activity you’ve created is illegal trade. Time for you to be regulated out of existence.”

Andrew Cashion
Dec 17, 2019

AOL, Gateways……DEX.Definitely the more interesting space to speculate.